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How important are processes to a company's competitive advantage?

A point that came up in this forum, Jaisundar wrote, " With due respect (to other references here), BPM done right is definitely about unlocking competitive advantage." So when it comes to competitive advantage, how key are a company's processes?

Every company has processes. Most of them are stored as knowledge in employees heads. Those processes get established with a lot of try and error and discussions to resolve how to get things done collaboratively. This results in a lot of small interruptions that quickly add up and prevent longer blocks of time necessary for creative thinking. With an easy to use BPM system, people share those processes resulting in less interruptions. Furthermore, employees spend a lot of time copying information from one app to another manually. Integrating the many systems involved in a process further reduces the hassle that employees have to go through.

While I believe that business processes can be a competitive advantage for any organization, there are particular stages where business process becomes more a differentiator. So much depends upon the product maturity of an industry as to how an organization might use business processes to its advantage.

Business processes that are dynamic and nimble can make a competitive difference for a company that is in a "disrupter" stage from the perspective of product/market lifecycle. However, if the company is in a more "Main Street" stage, business process innovations may be the primary means for achieving a competitive advantage.

When defining business processes and using them as a differentiator, it's important to evaluate the relative maturity of the industry and determine based upon that understanding which business process innovations will be most effective to create and sustain a competitive advantage.

I think there are two important angles to competitive advantage. First is the customer experience and if people are equipped with the right information at the right time within the relevant process then good decisions can be made and implemented. The second is being efficient by removing repetitive work and automating as required within front end processes which contribute to competitive pricing. Good BPM supporting technology should support these key issues.

Good processes are company assets but must remain “adaptive” to changing circumstances such as reacting to a competitor’s actions?

No question processes are a competitive advantage. Processes are at the core of business, whether structured, unstructured, sequential, dynamic etc.... However, it is how a process is executed that is the differentiator. Furthermore, what enables a process, ie. people, tech etc, and how it behaves in situations determines differentiation and innovation.

I'd merely add that the second order effect of implementing BPM is the telemetry it gives about people and how they use the processes. Now you know how your resources are deployed, you can see how effective they are and you can measure, empirically, the impact of your management.

Knowing where you are, what direction you are going and how fast, beats, guessing where you are, assuming it's the right direction and holding up a wet finger to calculate your speed.

For the start I think competitive advantage comes from the products or services and what you promise about it.

But then it's already time for process, because that's 'the thing' that has to deliver what a company promises.

In my town there are 8 pizzeria's. They all have the same products; a delivered pizza. 3 of them promise 'the tastiest pizza in town. 3 others promise 'the fastest pizza in town' and the last 2 promise 'the cheapest pizza in town'.

I don't eat pizza very often, but when I eat one, it must be tasty, so I choose one of the first 3.

A process has many characteristics (workflow, people, information, supplies, tools, steering etc) to make it happen. So what pizzeria has the most grip on it's processes so they deliver what they promise? I tried them all and two are really good and I will return....their processes do what they promise.

The end results of the processes which are either producing a product or service of perceived more value to a customer is what that can be later considered competitive advantage. Anything that makes something cheaper, better or faster provides this and processes help us get there.